In late 2006, 4 telcos were able to grab a 3G license from the 5 slots the NTC was bidding out. CURE was the 4th entity that was given the license to operate at the 10 to 2100 MHz band despite the fact that the telco doesn’t even have any network infrastructure in place.
The other 3 telcos — Smart, Globe and Sun Cellular (via Digitel) — were ready but only Smart and Globe have extensive network coverage nationwide.
By last quarter of last year, CURE hasn’t done a lot to be able to offer the 3G service. The license will default by June 2008 if they don’t do anything. Sun only announced its introduction in 3G this year but has not fully released it commercially — a move that allowed them to keep their 3G license.
CURE, on the other hand, was doomed. With the lack of funding and interest for potential partners, they decided to sell out. Smart was the likely savior and on April 28, 2008, PLDT disclosed to the SEC that it has bought CURE.
Smart Communications Inc. (“œSmart”), a wholly-owned subsidiary of Philippine Long Distance Telephone Corporation (“œPLDT”) (PSE:TEL) (NYSE:PHI), announced today that it has acquired the entire issued and outstanding capital stock of PH Communications Holdings Corporation (“œPH Communications”) and Francom Holdings, Inc. (“œFHI”), which collectively own 100% of Connectivity Unlimited Resource Enterprise, Inc. (“œCURE”). Both companies were controlled by an investor group led by Mr. Roberto V. Ongpin. PH Communications and Francom Holdings owned 96.57% and 3.43%, respectively, of CURE. Smart disclosed that it acquired the two companies for the total amount of Php 419.54 million.
Smart also intends to directly invest up to Php 210 million in CURE, in the form of subscriptions for new shares of CURE. The fresh funds will be used by CURE for working capital purposes.
CURE is one of the four licensees awarded by the National Telecommunications Commission with a 3G frequency in December 2006. It was awarded an allocation of 10 Mhz in the 2100 Mhz band and expects to launch its commercial service in May this year.
It was a close call and a win-win for both Smart and CURE.
The other curious question was “How could an unknown CURE able to get a 3G license from NTC?” Two words — Bobby Ongpin.